Get the Skinny on Buying FedEx Ground Routes and FedEx Home Delivery Routes
If you are considering investing in a FedEx route for the first time we recommend starting with a pickup and delivery (P&D) FedEx business. A Fedex P&D route business is easy to learn and simple to operate.
The Structure of a FedEx P&D Route
FedEx P&D operations deliver to local homes and businesses in a designated territory, outlined in your Independent Contractor (IC) or Independent Service Provider (ISP) contract.
There are two sides to the P&D coin: home delivery routes and ground routes.
Historically, contractors could have either home delivery routes, grounds routes, or both.
Along with the FedEx transition to all ISPs, FedEx will require a contractor to operate both home delivery routes and ground routes within a given area by May 2020.
The FedEx home delivery routes:
Primarily deliver to residential households.
Operate Tuesday through Saturday.
Have smaller to medium trucks and boxes.
Have high seasonal variability (with businesses often making a large part of annual revenue in the four weeks leading up to Christmas).
Ground routes are the other side of P&D routes.
FedEx ground routes feature:
Delivers primarily to commercial businesses.
Heavier packages and larger trucks.
Routes that run Monday through Friday.
Less seasonal variability than home delivery routes.
The Pros and Cons of a FedEx P&D Route
Easier to hire drivers
Concentrated geographic territory
Lower risk than linehaul runs
Ability to increase business size and ramp up operations
Lower gross profit than linehaul runs
You must own both ground routes and home delivery routes in your territory (this can also be a pro: overlap may be a pain, but it also increases the efficiency of the operation and can increase the profit)
Intense seasonal variability within home delivery routes
Are you the right investor for a FedEx P&D Route?
While the average investor in a FedEx route varies widely, we do notice a number of similarities among those who buy a FedEx route:
You might be the right investor to buy a Fedex route if you:
Have some type of business background
Previously owned or operated a company with employees
Have experience making payroll
Know how to manage customers and customer issues/concerns
Understand business financials and the basics of investment
Have a sense for how you will fund or finance a FedEx route investment
We’d love to talk with you more about FedEx P&D routes and how to evaluate the routes for sale.